Have You Heard?

May 2, 2011 8:50 AM ET

Daily State of the Markets Monday Morning - May 2, 2011

Good morning. While perhaps not on the same magnitude as word that either of the Kennedy's or MLK had been shot, or that man had actually set foot on the moon, the news that Osama bin Laden had been killed at the hands of the U.S. military will likely cause one to remember where they were when they got the news. I, for one, was just taking my seat on a Frontier Airlines flight which would soon be bound for San Diego, where NAAIM's (National Association of Active Investment Managers) national meeting is being held.

As I buckled in, I got a text message from my daughter on my nifty new HTC Thunderbolt (and for the record, 4G and the bigger screen were the deciding factors in that purchase) that read, "Have you heard?" Given that my youngest is a senior in high school and only has something like nine days of school left, my assumption was that my daughter was texting to tell me something about the dog or that her latest concert adventure was finally planned. So, imagine my surprise when the next text I received read, "Osama bin Laden is dead."

To be sure, this caused me to snap to attention. Instead of a sleepy flight heading west into the dark of night, the airplane was soon buzzing. Soon, the words, "have you heard?" could be heard up and down the aisle. And given that Frontier still has those little T.V. screens on the seat in front of you, it wasn't long before everybody on the plane figured out how to tune in to NBC, CBS, or CNN.

To my surprise, there was no whooping it up, no fist pumping, or chants of "U-S-A!" No, given that the enormity of the 9/11 tragedy is likely still with each and every American, this plane full of people kept pretty quiet - although plenty of passengers were none too happy that the flight attendant, who obviously had not heard, continued to yammer on about the beverage choices, the snacks available, and the fact that Frontier only accepts credit and debit cards while the President was giving the nation work of bin Laden's demise.

As any true market geek would, I immediately tapped my stock market app on the phone and pulled up the latest quote of the emini S&P futures. And sure, enough, the traders who were working late on a Sunday evening were celebrating. However, given that silver was also down about 10%, I'm not completely sure the "Have you heard" rally is going to last too terribly long.

We need to remember that the bottom line in the stock market is, well, the bottom line. And given that (a) Wall Street is a cold-hearted place and (b) stocks have been moving in a straight up fashion on the tails of strong earnings, decent economic data, and a renewed plunge in the dollar, it is important to note that stocks have become overbought and are due for at least some sort of a pullback in the near future. Therefore, while the news that public enemy #1 is no longer a threat is certainly good, I'm going to keep my emotions in check and continue to watch the action as objectively as possible. After all, you never know when the next "have you heard?" is going to crop up.

Turning to this morning... Most of the overseas markets that were open overnight advanced on the bin Laden news. However, the S&P futures are off their highs at this point.

On the Economic front... We don't have any economic data to reveiw before the bell this morning, but we will get reports on Construction Spending and ISM at 10:00 am.

Thought for the day: Try not to let success go to your head or defeat into your heart...

Pre-Game Indicators

Here are the Pre-Market indicators we review each morning before the opening bell...

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